| Co-Investigator(Kenkyū-buntansha) |
HATTA Tatso THE UNIVERSITY OF TOKYO, CENTER FOR SPESIAL INFORMATION SCIENCE, PROFESSOR, 空間情報科学研究センター, 教授 (70008647)
SHIBATA Hirofumi KANTO-GAKUEN UNIVERSITY, ECONOMICS, PROFESSOR, 経済学部, 教授 (80112001)
IHORI Toshihiro ECONOMIC AND SOCIAL INSTITUTE, RESEARCH FELOW, 経済社会総合研究所, 総括政策研究官 (40145652)
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| Research Abstract |
This project has investigated risk management policies such as social security, trade conflicts, national security, and redistribution policy. We have considered the macroeconomic implications of public safety nets and the relationship between public and private adjustments against various risks. We have also developed theoretical frameworks for international public goods including defense spending, foreign aids, and abatements. Among others the followings are main results. (I) The neutrality theorem of public goods may be extended to the case where economic growth cannot affect the real equilibrium if we allow for abatement activities against pollutions due to growth. (ii) The international public good may become an inferior good if its role is to reduce probabilities of bad states. (iii) The steady-state level of national security may be too much in the competitive economy although it is too little compared with consumption. It is well known that capital accumulation may be too much in the long run when the competitive steady state economy is on the inefficient path. This is the income effect. If the income effect dominates the free-riding effect, the level of national security at the non-cooperative solution could be larger than the first best level. The larger the social discount rate and the smaller the penalty ratio, it is more likely to have such a paradoxical case. (iv) An increase in capital stock raises real income, stimulating the demand for national security. In order to have a larger amount of national security, the country is willing to pay more spending on national security. The national security-GDP ratio increases with capital accumulation. We have derived the exploitation hypothesis without depending on a public good nature of security spending among allies.
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